October 1, 2019 is the effective date for the beginning of Microsoft’s new licensing program for Dynamics 365. While the new pricing model kicks in on October 1, for new customers, existing customers will also transition to the new model at their next annual renewal. For example, if you just completed the annual renewal of your licenses on August 1, your licensing fees will not change until August 1, 2020.

Dynamics 365 will no longer offer multi-application bundles, for Customer Engagement (CE) and Unified Operations (UO) plans. Instead, they will adopt an ‘a la carte’ menu from which to select the licenses of individual apps.

Part of the change involves separately licensing features as ‘base models’ e.g. for Dynamics Finance and Operations Enterprise the enterprise base licensing options will be Supply Chain, or Finance, or Retail. Users who need the functionality of more than one base license can add the same features to an existing base license as an “Attach’ license at a significantly lower cost for the additional attach license.

The licensing for: Talent. and Marketing and Customer Insights are also affected but are a little different;

Microsoft suggests the overall effect will be around a 10% price increase.
Note there are also significant changes to the Power apps licenses.
That of course also reflects their rising costs of providing hosted services and considerable increases in system enhancements. It is however important you carefully consider who needs to use which application and features to ensure your license cost is optimised.

This note only scratches the surface and every Dynamics 365 customer will have a different set of requirements. Don’t wait for your subscription, renewal work with us now to better understand the changes to prepare and budget accordingly.

At the moment no changes have been announced for on premise licensing.
Activity users. Sales Professional, Customer Service Professional, and Team Member licensing will remain unchanged.

There are licensing options for:
• Additional environments
• Additional database capacity
• Additional file storage

Dynamics 365 Add-ons
Subscription add-ons apply across a single tenant; they are not tied to a specific user.
Subscription add-ons can be purchased at any time and remain a part of the subscription for the remainder of the subscription term.

Microsoft Power BI in Dynamics 365 – Dynamics 365 Unified Operations Plan and Dynamics 365 Plan
Users are not provided with any standalone or general-purpose Power BI license or use rights. Customers who require Power BI Pro will need to license and pay for it separately.
The Dynamics 365 Unified Operations applications themselves may embed Power BI content within the service User Interfaces. This is simply a product feature and no Power BI licensing is required to access this content (e.g. view embedded tables and charts)

Additional Common Data Service Capacity Add-ons
Common Data Service platform capacity add-ons gives flexibility to increase the storage capacity associated with your PowerApps subscription in increments of 1GB per additional capacity add-on license.

Subscription storage
Storage corresponding to a customer subscription is tracked against all the Dynamics 365 Customer Engagement Plan application instances associated with the tenant.
The following add-on capacity licenses are available:
• Additional Common Data Service Capacity Add-on:
• Additional Common Data Service File Capacity Add-on
• Additional Common Data Service Log Capacity Add-on

Dynamics 365 for Marketing Additional Contacts Add-on
Dynamics 365 for Marketing is based only on the number of contacts intended to be used for marketing activity and not the total number of contacts in database. Minimum purchase quantities must be met to activate packs. Customers with Dynamics 365 for Marketing included with Customer Engagement Plan application (2K contacts included), are required to purchase the Additional Contacts 8K add-on pack before purchasing any of the other Additional Contacts packs.

Microsoft Social Engagement Additional Posts Add-on
The Additional Posts Add-on may be purchased in increments of 10,000, 100,000, or 1,000,000 posts per month. On the first day of the month, the number of purchased additional posts is added to the included quantity of 10,000 posts. All unused posts expire at the end of each month.

Portals and Page Views Add-on
The default Portal provided with Dynamics 365 Customer Engagement Plan application be extended by purchasing licenses for additional portals, for use as a non-production additional production portals. Customers may purchase additional page views.

Dynamics 365 Call Intelligence Add-on
Conversation Intelligence, included capacity for Sales Insights, help sales teams gain insights from conversations with customers. Dynamics 365 Call Intelligence is a capacity add-on for Sales Insights that enables organizations to analyze additional hours of call recordings. Customers may purchase additional capacity (1k hours/tenant/month)

Dynamics 365 for Customer Service Chat Add-on
Customer Service Chat is an add-on capability for the Dynamics 356 Customer Service Enterprise application that helps agents engage in real-time with customers and resolve issues faster. Customer Service Chat is licensed per user and ensures that support agents and end users can interact effectively.

Use of historical Supervisor reporting through Omnichannel Intraday Insights, Omnichannel Chat Insights and Omnichannel Sentiment Insights Dashboards requires Power BI Pro license or higher.

Dynamics 365 for Field Service – Resource Schedule Optimization Add-on
– Resource Scheduling Optimization is an add-on capability for the Dynamics 365 for Field Service application that enables customers to automatically create a schedule for the appropriate resource in SharePoint, while simultaneously optimizing appointment setting for travel time, mileage, and many other constraints.
-Resource Schedule Optimization is licensed per resource included in the optimization process and will typically be accessed by a scheduler or dispatcher user who will designate any number of resources to be included. Resources may be individuals, such as field technicians or other human resources.
– The add-on license allows for unlimited use of schedule optimization, which may be on a regular cadence such as daily or weekly, or ad-hoc.
-A Dynamics 365 for Field Service license is required for managing the Resource Schedule Optimization.

Dynamics 365 Unified Operations – Order Lines Add-on
The Dynamics 365 for Operations – Order Lines Add-on allows customers to extend the use of their
application by providing a transactional licensing mechanism for indirect access by partners, customers,
connected automated systems, loT devices and bots. Dynamics 365 Unified Operations – Order Lines

For qualifying transaction types, customers will be able to license indirect access on a transactional ‘order line’ basis rather than on a per user basis
• Avoid common multiplexing licensing issues.
• Supports a broader set of external user integrations.
• Enables licensing of automated systems and devices that do not include users (e.g. IoT scenarios)
• Improves licensing cost transparency and predictability
• Ties licensing cost more directly with business outcomes

To be eligible for ‘order lines’ licensing a transaction must:
(i) Be an indirect transaction that utilizes an OData or DIXF integration. Direct usage of the Dynamics application or integrations outside of OData or DIXF may not utilize ‘Order Lines’ licensing.
(ii) Only update data in the tables designated as qualifying for Order Lines.